What is Trading Account

What is Trading Account? – Your Gateway to Stock Market!

A trading account is a platform for buying and selling stocks. It serves as a link between the investors’ bank and Demat accounts.

Read the article to know everything about Trading Accounts.

Content:

Trading Account Meaning

A Trading Account helps you buy and sell Shares, ETFs, and Other Financial Instruments listed on the stock market. When you open a trading account with a broker, you will be provided trading software using which you can place buy and sell orders. Or you can also place orders via a call with the broker.

To have a trading account, you must be aware of online trading. Learn about online trading here. 

Types of Trading Account

Equity and Currency Account: When you open a normal trading account, you can transact in Equity and Currency financial instruments.

Commodity Account: This account helps you buy and sell financial instruments in the commodity market like Gold, Silver, Crude Oil, etc.

If you are new to the concept of commodity trading, then read this article.

Single Margin Account: This is a combination of Equity, Currency, and Commodity Account that helps you buy and sell financial instruments conveniently in all segments. Only a few brokers, like Alice Blue, offer a Single Margin Account.

Online Trading Meaning

Online trading is nothing but placing buy and sell orders through a trading platform. A broker can provide you with a trading platform either via a Mobile or Desktop App or a Website. With an online trading platform, you access various financial products like:

  • Stocks
  • Indices
  • Mutual Funds
  • Treasury Bills
  • Bonds
  • Equity Derivatives
  • Commodities Derivatives
  • Currencies Derivatives
  • Exchange-Traded Funds

To gain complete knowledge in stocks and mutual funds, read our blog on Mutual Funds Vs Stocks. 

You can also access amazing features like:

  • Live News.
  • Stock Scanners to find the best stock to invest in.
  • Different types of charts.
  • Tools to analyze the charts etc.

Usually, to trade or invest in the stock market, only having a trading account is not enough. You also need to have a Bank Account and a Demat Account. 

Why do you need a Demat and Bank Account? Let’s understand that with an example.

  • Imagine one fine day you decide to buy Reliance Shares.
  • To buy the shares, you need money in the trading account. How do you add money to the trading account? You guessed it right, with a BANK ACCOUNT.
  • After the funds are added, you need to place an order via Trading Software.
  • Once the order is successfully placed, you will receive Electronic Share Certificates of Reliance in your DEMAT ACCOUNT after 2 days.

As simple as that! 

You might be aware of how to open a Bank Account, but what about a Trading and Demat Account? 

Read on to learn more about How to Open A Trading and Demat Account Online in just 15 Minutes!!!

If you’re confused between a Demat and a Trading account, click on this link to get clarified. 

Note* Usually, Trading and Demat Accounts are opened at the same time.

How to open a Trading Account?

If your Mobile no. is linked with Aadhar, you can open the Trading & Demat Account online. 

Follow the simple process given below:

  • Click on this Link
  • Fill in your Name, Email, Mobile Number, and State, and click on Open an Account.
  • Upload account opening documents. 
  • Provide an IPV (In-person verification) by showing your PAN to the camera along with your face.
  • E-sign the documents by verifying your Aadhaar with your Mobile Number.
  • Your account will be activated within 24 hours.

Documents required to open an account:

  • Identity Proof (PAN Card Mandatory)
  • Address Proof (Aadhar, Voter ID, Passport, etc.)
  • Passport Size Photo
  • Income Proof (Latest six-month’s bank statement, Latest ITR copy, Three month’s salary slip)
  • Bank Proof (Cancelled Cheque, Passbook Copy or Bank Statement with visible Bank Account Number, MICR, and IFSC code)
  • Scanned copy of the signature (only in case of online account opening)

Check out a detailed step-by-step process of account opening here.

Why you should open an account with Alice Blue?

There are two types of brokers, a discount broker and a full-service broker. 

A discount broker provides you with trading and investing services at the lowest possible cost. A full-service broker provides full-blown services like investing tips, hand-holding, trading reports, etc., but all these services come with a higher cost.

Well, Alice Blue is an Exception! 

We provide the services of a full-service broker but at the cost of a discount broker. 

We charge the lowest brokerage yet provide full-blown services like a full-service broker. 

Check out some of the unique services we offer:

Unique Services

To make your trading experience smoother, we offer a single account for Equity and Commodity Exchange and also provide one Unique Product:

  1. Trade School: It is a stock market education platform that helps you learn everything about stock markets from the beginner to advanced level via webinars, live sessions, courses, etc. from the Top Traders & Investors in India.

We hope that you are clear about the topic. But there is more to learn and explore when it comes to the stock market, and hence we bring you the important topics and areas that you should know:

Market What is Primary Market?
Difference between IPO and FPO
What is Secondary Market?
What is Bond Market?
Bull vs Bear Market
Trading What is Online Trading?
Difference between Futures and Options
What is Options Trading?
What is Commodity Trading?
What is Algo Trading?
Investment What is Bonus Share?
What is Valuation of Shares?
What is Corporate Action?
Analysis Stock Market Analysis
Individual Topics Stoploss Order
What are CTT & STT Charges?
India Vix
Difference between FDI and FII
Account What is Demat Account
Difference Between Demat and Trading Account

FAQ(Frequently Asked Questions)

1. What Is The Difference Between Demat Account And Trading Account?

Demat and Trading Accounts are very much interconnected and interdependent on each other. A Trading Account helps you buy and sell Shares, and Other Financial Instruments listed on the stock market while a Demat Account acts like a Bank Locker that stores your shares safely.

2. What Is The Purpose Of Trading Account?

Trading Account helps you buy and sell Shares, ETFs, and Other Financial Instruments listed on the stock market.

3. What Is The Use Of Demat Account In Trading?

Demat Account to hold and store the shares, ETFs, and Other Financial Intruments which you have bought with your Trading Account on the stock market.

4. Does Alice Blue provide a Single Margin Account?

Yes, like Alice Blue offer a Single Margin Account.

Quick Summary

  • A Trading Account helps you buy and sell Shares, ETFs, and Other Financial Instruments listed on the stock market.
  • There are 3 types of trading accounts
    • Equity and Currency Account: Transact in Equity and Currency financial instruments.
    • Commodity Account: Transact in the commodity market like Gold, Silver, Crude Oil, etc.
    • Single Margin Account: This is a combination of Equity, Currency, and Commodity Account. Only a few brokers like Alice Blue offer a Single Margin Account.
  • If your Mobile no. is linked with Aadhar, you can open the Trading & Demat Account online. 
  • Read the complete procedure for opening a Demat account online in the above article. Also know about why Alice Blue is could be the best stock broker for you.

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